YES. The strike was legal because there was a violation of the collective bargaining agreement by Company.

It was part of the CBA that the Security

Guard Section will remain. Yet, the Company did not comply with the stipulation in CBA. It was thus an assurance of security of tenure, at least, during
the lifetime of the agreement. For what is involved is the integrity of the agreement reached, the terms of which should be binding on both parties

The stand of Shell Company as to the scope of management prerogative is not devoid of plausibility, management prerogative of the Company would
have been valid if it were not bound by what was stipulated in CBA. The freedom to manage the business remains with management. It cannot be
denied the faculty of promoting efficiency and attaining economy by a study of what units are essential for its operation. To it belongs the ultimate
determination of whether services should be performed by its personnel or contracted to outside agencies. However, while management has the final
say on such matter, the labor union is not to be completely left out.

An unfair labor practice is committed by a labor union or its agent by its refusal ‘to bargain collectively with the employer’. Collective bargaining does
not end with the execution of an agreement, being a continuous process, the duty to bargain necessarily imposing on the parties the obligation to live
up to the terms of such a collective bargaining agreement if entered into, it is undeniable that non-compliance therewith constitutes an unfair labor
practice.

BPI Employees Union-Davao City-FUBU vs. BPI, G.R. No. 174912, July 24, 2013

BOMC, primarily engaged in providing and/or handling support services for banks and other financial institutions, is a subsidiary of the Bank of
Philippine Islands (BPI) operating and functioning as an entirely separate and distinct entity.

A service agreement between BPI and BOMC was initially implemented in BPI’s Metro Manila branches. In this agreement, BOMC undertook to
provide services such as check clearing, delivery of bank statements, fund transfers, card production, operations accounting and control, and cash
servicing, Not a single BPI employee was displaced and those performing the functions, which were transferred to BOMC, were given other
assignments.

The Manila chapter of BPI Employees Union (BPIEU-Metro Manila-FUBU) then filed a complaint for unfair labor practice (ULP). (LA) decided the
case in favor of the union. The decision was, however, reversed on appeal by the NLRC. BPIEU-Metro Manila-FUBU filed a petition
forcertiorari before the CA which denied it, holding that BPI transferred the employees in the affected departments in the pursuit of its legitimate
business. The employees were neither demoted nor were their salaries, benefits and other privileges diminished.6

the service agreement was likewise implemented in Davao City. Later, a merger between BPI and Far East Bank and Trust Company (FEBTC) took
effect on April 10, 2000 with BPI as the surviving corporation. Thereafter, BPIs cashiering function and FEBTCs cashiering, distribution and
bookkeeping functions were handled by BOMC. Consequently, twelve (12) former FEBTC employees were transferred to BOMC to complete the latters
service complement.

BPI Davaos rank and file collective bargaining agent, BPI Employees Union-Davao City-FUBU (Union), objected to the transfer of the functions and
the twelve (12) personnel to BOMC contending that the functions rightfully belonged to the BPI employees and that the Union was deprived of
membership of former FEBTC personnel who, by virtue of the merger, would have formed part of the bargaining unit represented by the Union pursuant
to its union shop provision in the CBA.

Union filed a notice of strike before the National Conciliation and Mediation Board (NCMB) on the following grounds:
a) Contracting out services/functions performed by union members that interfered with, restrained and/or
coerced the employees in the exercise of their right to self-organization;

The Union is of the position that the outsourcing of jobs included in the existing bargaining unit to
BOMC is a breach of the union-shop agreement in the CBA. In transferring the former employees of
FEBTC to BOMC instead of absorbing them in BPI as the surviving corporation in the merger, the
number of positions covered by the bargaining unit was decreased, resulting in the reduction of the
Union’s membership. For the Union, BPI’s act of arbitrarily outsourcing functions formerly performed
by the Union members and, in fact, transferring a number of its members beyond the ambit of the
Union, is a violation of the CBA and interfered with the employees’ right to self organization. The Union
insists that the CBA covers the agreement with respect, not only to wages and hours of work, but to all
other terms and conditions of work. The union shop clause, being part of these conditions, states that
the regular employees belonging to the bargaining unit, including those absorbed by way of the
corporate merger, were required to join the bargaining union “as a condition for employment.” Simply
put, the transfer of former FEBTC employees to BOMC removed them from the coverage of unionized
establishment. While the Union admitted that BPI has the prerogative to determine what should be
done to meet the exigencies of business in accordance with the case of Sime Darby Pilipinas, Inc. v.
NLRC,19 it insisted that the exercise of management prerogative is not absolute, thus, requiring good
faith and adherence to the law and the CBA. Citing the case of Shell Oil Workers’ Union v. Shell
Company of the Philippines, Ltd.,20 the Union claims that it is unfair labor practice for an employer to
outsource the positions in the existing bargaining unit.

ISSUE: Whether or not the act of BPI to outsource the cashiering, distribution and bookkeeping functions to BOMC is in conformity with the law and
the existing CBA.

HELD:yes

The Union, however, insists that jobs being outsourced to BOMC were included in t